The net export (NX)function crosses the horizontal axis at a level of national income where the
A)X and IM curves intersect.
B)X curve reaches the horizontal axis.
C)IM curve reaches the horizontal axis.
D)X and IM curves are at their farthest distance apart.
E)X curve reaches its maximum.

Question

Quizplus · Accepted Answer

The net export (NX) function crosses the horizontal axis at the level of national income where exports (X) equal imports (IM), which is when the X and IM curves intersect. This point indicates that net exports are zero.

The Net Export (NX)function Crosses the Horizontal Axis at a Level